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Two Market Pros Expect Stocks to Keep Climbing

Monday, 7 May 2007 | 1:08 PM ET

Drew Kanaly, chairman at Kanaly Trust Company, told CNBC’s “Power Lunch” that good Fed policy combined with the right moves on taxes, regulation and trade will continue to drive the stock market higher.

He expects the Federal Reserve to cut rates in August or September.

M&A Driving the Market
A new round of M&A activity is driving the market to even higher highs, and Drew Kanaly, Kanaly Trust Company chairman; William Buechler, Barclay Partners Asset Mgmt. president; and CNBC's Sue Herera discuss how much higher the market rally will last

“That would be a real surprise to the market on the upside,” Kanaly said Monday. “Typically, the Fed follows the T-bill and the T-bill has been trading below the Fed Funds (rate) for quite some time.”

But William Buechler, president of Barclay Partners Asset Management, said he expects the Federal Reserve to leave rates unchanged through the end of the year.

“As long as the Federal Reserve continues to supply the liquidity and we still have the big private equity players out there waiting for opportunities, I don’t see any other way but for the market to continue to trend higher, he said.”

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  • Sue Herera is a founding member of CNBC, helping to launch the network in 1989. She is co-anchor of "Power Lunch."

  • Tyler Mathisen co-anchors CNBC's "Power Lunch." Mathisen also co-anchors "Nightly Business Report produced by CNBC."

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Kenny Polcari